Native Advertising Boosts CPG Brand Performance

By: Debra Eskra

Creating advertising that resembles news and other editorial content is not new.  The concept has been around for years in the form of advertorials and “special advertising sections” laid out to look like regular content. What’s newer is applying the concept into a user’s online experience.  As digital advertising continues to take off, native advertising will as well.  eMarketer notes that native ad spending is expected to double from $2.4 billion to $5 billion between 2013 and 2017, as compared to display advertising, which is projected to grow at half that rate.

There are many benefits of native advertising to CPG marketers and agencies, and consumers as well. Marketers and agencies now have a new channel through which to reach consumers and hold an edge over competitors, specifically private label.  Consumers gain more relevant and entertaining information resulting from the sophisticated targeting, content and creative opportunities native advertising offers.

Native advertising can reach a large audience and does so across multiple platforms almost seamlessly.  It is tailored advertising content for the publisher, so CPG brand managers and agencies can get the right message to the right audience.  It also provides a more personal experience for the consumer than traditional advertising.

Native advertising can include videos, photos and interactive gaming to draw in and activate the consumer.  It also moves advertisers away from costly direct response display ads which have the intent to “sell” and brings brand marketing into the online world.

Whether used as part of a social media or digital media campaign, native advertising takes many forms.  It includes social media such as promoted Tweets, brand stories on Facebook, and sponsored articles on BzzFeed and Instagram, for example.  Traditional print publishers with a heavy online presence also incorporate native advertising, including news publishers such as The New York Times and Wall Street Journal; sports media, such as Sports Illustrated, and lifestyle media, such as Us Weekly.

Research completed last year by IPG Media Lab, a consultancy, and Sharethrough, a native advertising solutions provider, highlighted consumer acceptance of native advertising.  Among the key findings:  consumers look at native ads 52 percent more frequently than banner ads and native advertising offered a 9 percent higher lift for brand affinity and 18 percent higher lift for purchase intent responses than banner ads.  The research also revealed that consumers view native ads for roughly the same amount of time as editorial content.

Social media sites in particular are responding to native advertising opportunities as the content and delivery platform are highly relevant. Pinterest-sponsored content has taken the place of banner ads.  Usually, larger brands are sponsors and ads are relevant to the content. Promoted ads on Facebook are integrated into a user’s newsfeed.  While they are labeled as sponsored, they show up in the newsfeed based on the user and the user’s friends’ Likes, making the content highly targetable.  Twitter recently launched its own exchange for native advertising on mobile, which will give marketers an additional on-the-go platform to advertise on.

Ad agency MDG, in a recent blog, cites some pretty overwhelming statistics. Here are just a few:

  • 75 percent of publishers currently offer some type of native advertising on their sites, and 90 percent say they either have considered or will consider using it
  • 67 percent of brands use native advertising in an effort to provide more relevant messaging
  • Purchase intent of those who click on native ads is 52 percent compared to only 34 percent for banners
  • People who click on native ads have higher brand loyalty (32 percent) than those who click on banners (23 percent)

Can you ignore native advertising as you adjust your marketing spend?

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